The Alinsky method: A demonstration of using humor as a weapon against a position …

GM: Money Back Deal: A reader’s response

Sometimes, my readers amaze me. What started out as a one-line “you sir, are a fucking moron” comment to my blog entry on General Motors and their money-back guarantee,  followed by my response to the commenter, turned into an enlightening e-mail exchange which I believe advances the conversation and adds an additional perspective to the issue.

Here is the e-mail exchange …

The top line is the commenter’s original response to my blog entry on the General Motors Money Back Guarantee. The plain text below the equal signs are my comments. The reader’s comments in response are in red italics.  Nothing was edited -- which accounts for the errors in the response. 

you sir, are a fucking moron
While the urge to reply in kind is great, perhaps I can serve the greater good by pointing out two things: one, you did not pose any real objection or refute what I wrote; and two, you do not seem to understand that my motivation was to inform my readers that if they truly believed a money-back offer was being extended, it could cost them thousands of dollars should they decide to exercise their option to return the vehicle.

“while its nice to bash them for a stupid program, which it is, the program isnt a scam, its in fact backed by an insurance group, which probably is federally backed. the dealer actually wants you to return the car because they get to purchase it for 67% of the invoice from gm or return it to gm. this means that on a 57k truck with a 50k invoice the dealer would get the truck into the used car inventory for 33k and some change. what dealer wouldn't want to have cars in there inventory at that type of discount. this is a very profitable proposition for the dealer.”

1 -- they were to ONLY receive a refund on the actual vehicle, not any dealer-installed or after market options;

“no one buys dealer installed options, but if they did and included it on the line one sales price it would still be refunded.”

2 -- they were not going to get their financing charges and any pre-payment penalty returned; they were still on the hook for any dealer "payoff payments" made on their behalf;

“gmac has no prepayment penalty and have 0% interest on everything anyway. if you were truly just renting a car then sign up for this and have a good time.”

3 -- they remained on the hook for all the title, license and vehicle taxes -- the sales tax would be returned;

“all this adds up to less than a few hundred dollars in the majority of states, and im sure the dealer would negotiate into the original deal a check back to the customer for that amount just to close a deal”

4 -- they needed to adhere to all of the terms and conditions and it was not as simple as driving the vehicle back to the dealer.

“the dealer is going to be more than willing to help fill out a form to get a car back with a couple thousand miles on it for 67% of invoice. this could actually negatively affect the value of a year or 2 old model.”

5 -- the transaction could appear as a voluntary repossession or return on their credit report. 

“there is no way possible this is going to show up as a repo, gm has bought an insurance policy on each deal and the loan will be paid. that is the bottom line.”

... as well as other gotchas -- like their trade-in being gone.

“that is usually a good thing, i read your article because i plan on scamming the program. if you have a trade in that you are 5k upside down in and your payoff is 30k and you were buying the 57k truck i mentioned earlier, if you structured the deal right, you could get a truck for a month and walk away from the deal owing nothing to anyone and then go buy whatever you want, including the truck you turned back in. you just have to put a business or a spouse as the line one buyer when you purchase the vehicle back used.”

“the dealer would over allow you on your trade and show the sales price as msrp. you could still stipulate that they cut you an additional check back to cover anything at the turn in period. the still make a little money on the first deal, they make money when they sell your trade, then you agree to pay them a few k profit when you buy your "used" truck back.”

“hope this makes sense. the point is, that its really a good program and any dealer anywhere would be more than happy to take a car back because it only HELPS them financially.”

“your gripe should be, that somewhere along the line, the government is footing the bill for all this mess. the insurance company has estimated that less than 3% of people buying will actually return the car. in most cases, my friend that owns a gmc dealer has told me, that the customer is just opting for the extra $500 anyway.”

This was a great response – and sure beats calling me a fucking moron. However, I have no way of verifying his assertions with respect to dealership actions and must take the GM “fine print” as it was originally offered. Without a doubt, this is the guy I want to negotiate my next car purchase. And while I do not believe in scamming the system, gaming the system to your own advantage is permissible.

One final cautionary note – the devil is in the details and not all dealers may be willing to go along with the program. Seek professional advice if necessary. Again, the buyback percentages may vary with the type of vehicle and other factors. This information is being offered only to further the discussion and does contain information that I cannot verify.

But, the reader does raise an interesting point about the transaction being financially beneficial to dealers. Perhaps this is the actual intent and that the dealer is planning to game the system themselves. Oh well, Karma is a bitch.

Again, this is the guy I want to negotiate my next car purchase.

-- steve

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